Corinthian Colleges has announced the closing of its remaining 28 for-profit schools, effective immediately, in what could be the largest shutdown in the history of higher education in the United States.
In a letter released to its 16,000 students, Corinthian said it would be relying on government agencies and other institutions to help place students who currently attend Heald College locations in California, Hawaii and Oregon and at Everest and WyoTech locations in California, Arizona and New York. The company said they are making transcripts available and working with other educational institutions to absorb the displaced students.
"I would like to know if I am allowed to transfer my credits, if the credits even mean anything," said Dominique Avila, 35, who withdrew from Heald College's campus in Roseville, Calif., late last year and was trying to get her transcripts transferred to another school. "What does that mean as far as my debt goes?"
The decision was made only weeks after Corinthian was fined $30 million by the US Education Department for altering job placement data, grades and attendance records, writes M. Alex Johnson for NBC News.
The investigation by the department began in January 2014 after discoveries were made that the college had been artifically boosting their job placement rates in an effort to entice new students. The company was then sued by the Consumer Financial Protection Bureau in September, which argued that the school had used the false rates to recruit new students. New students then took out private loans, which make up about 85% of the company's revenue.
Several campuses were found to have paid temporary employment agencies to hire graduates and then send them to work on the same campuses. Those students were counted as having successfully found employment. Students who were employed prior to enrolling in the college were also considered to have been successfully placed by the school.
While a number of the locations were sold to a nonprofit education group last year, the remaining 28 have proved to be difficult to sell. Corinthian says this is due to "federal and state regulators seeking to impose financial penalties and conditions on buyers."
"We believe that we have attempted to do everything within our power to provide a quality education and an opportunity for a better future for our students," Chief Executive Jack Massimino said.
The Education Department is planning to help students from those 28 campuses, and some may even have a fraction of their loans forgiven. The department estimates that it would cost taxpayers $214 million to forgive the federal loans of all remaining students.
"What these students have experienced is unacceptable," it said in a statement. "As Corinthian closes its doors for good, the department will continue to keep students at the heart of every decision we make."